The word “increase” surfaces, tempered by caution about turnover. Across the country, similar conversations are taking place as firms look ahead to 2027, guided by a fresh data set that tries to put a number on the mood.
Aon’s Annual Salary Increase and Turnover Survey for India 2026‑27 collected responses from more than 1,200 organisations spread across 45 industries. The survey window captures the fiscal period 2026‑27, offering a forward‑looking snapshot of what employers expect to do with pay packets.
India Inc to give 9.1% pay hike in 2027, almost similar to 2026: Aon https://t.co/cLsP02MfX6
The headline figure from the survey is a 9.1% salary increase expected for 2027. That overall lift is not uniform; certain sectors are poised to outpace the average. Non‑banking financial companies are projected to lead the pack with a 10.1% rise. Close behind, the energy sector anticipates a 9.9% hike, while real estate and infrastructure firms look toward a 9.8% increase. These sector‑specific numbers illustrate where demand for talent is strongest and where companies are willing to loosen the purse strings to attract and keep skilled workers.
Employers cite a mix of domestic strength and external demand as reasons they feel able to raise pay.
While pay is set to climb, the survey also flags a worsening retention picture. Overall attrition rose to 18% in 2026, up from 16.2% in 2025 and 17.1% in 2024. The climb signals that more employees are moving between jobs, a trend that adds pressure on HR teams to keep salaries competitive while also addressing the reasons people leave. The survey notes that talent retention remains a challenge, even as firms plan to spend more on compensation.
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Employers cite a mix of domestic strength and external demand as reasons they feel able to raise pay. Roopank Chaudhary of Rewards Consulting, quoted in the survey’s commentary, said, "Strong domestic consumption, sustained investment and export growth continue to support business confidence, allowing employers to invest in talent while maintaining cost discipline." That trio — steady home‑market spending, ongoing capital investment, and growing exports — creates a backdrop where firms see room to maneuver on wages without jeopardising margins.
The extra money is not being spread evenly across all staff. Chaudhary also observed that "stable salary budgets are enabling a more targeted approach to pay. A modest rise in non‑merit adjustments, particularly in manufacturing and technology, reflects greater focus on market alignment, scarce skills and critical talent. Employers are increasingly focused not only on how much they spend, but where that investment can deliver the greatest workforce and business value." In practice, this means firms are directing raises toward roles that are hard to fill, toward employees with niche expertise, and toward positions deemed critical to strategic goals. At the same time, the survey highlights a growing emphasis on upskilling and the adoption of artificial intelligence. According to the data, 46.1% of organisations had already established use of AI productivity tools by 2025, a figure that suggests many are preparing their workforces for a more tech‑driven future.
Not every company is riding the wave of optimism. The survey’s narrative notes the "ground reality of salary freezes and job insecurity in some companies," a point underscored by comments from Sridhar Vembu, the founder of Zoho, who has warned that not all firms can afford the projected increases. Those divergent experiences remind readers that the 9.1% figure is an average, masking a spectrum of outcomes across India’s vast corporate landscape.
As the 2026‑27 window approaches, the Aon survey offers a compass: pay is expected to rise, attrition is ticking up, and companies are trying to balance cost control with targeted investment in the skills they deem most valuable. Whether the projected gains materialise will depend on how those macroeconomic forces — consumption, investment, exports — evolve and how well firms navigate the tightrope between rewarding talent and keeping their books in balance.